# In the matter of State Bank of India Vs. Raheena, CP(IB)/04/KOB/2022

> NCLT judgment dated 2022-06-24. Citation: TCN-2022-NCLT-02061. The case involves two petitions, CP(IB)/04/KOB/2022 and CP(IB)/05/KOB/2022, filed by State Bank…

- **Court:** NCLT
- **Order date:** 24 Jun 2022
- **Citation:** TCN-2022-NCLT-02061
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-raheena-cp-1bc97ef2

## Summary

### Background

The case involves two petitions, CP(IB)/04/KOB/2022 and CP(IB)/05/KOB/2022, filed by State Bank of India under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. These petitions are against the personal guarantors, Mrs. Raheena and Mr. Nazar S, of the corporate debtor, M/s. Nasco Trading India Ltd., seeking to initiate the Insolvency Resolution Process. The corporate debtor is already undergoing Corporate Insolvency Resolution Process pursuant to an earlier order of the Tribunal. The State Bank of Travancore (now merged with State Bank of India) had granted credit facilities to

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## Facts

The State Bank of India (SBI), formerly State Bank of Travancore (SBT), extended credit facilities amounting to Rs. 2,00,00,000/- to M/s. Nasco Trading India Ltd. through a sanction letter and loan agreement. This credit was intended to provide working capital. The credit facility was subsequently enhanced, reaching Rs. 9.5 Crore in cash credit along with a term loan of Rs. 1 Crore by February 18, 2016. M/s. Nasco Trading India Ltd. executed a Term Agreement and Hypothecation Agreement, creating Equitable Mortgage by depositing Title Deeds of properties of Personal Guarantors, Shri Nazar and Ms. Raheena. Mrs. Raheena and Mr. Nazar S, acting as personal guarantors, executed deeds of guarantee and supplementary deeds to cover the increased credit limits. These guarantees

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## Issues and analysis

### Issue 1: Whether the applications filed by State Bank of India under Section 95(1) of the Insolvency and …

**Ratio:** Section 95(1) of the Insolvency and Bankruptcy Code, 2016, allows a creditor to file an

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**Reasoning:** The Tribunal considered the provisions of Section 95(1) of the IBC, 2016, and the

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**Interpretation:** Section 95(1) of the IBC, 2016, provides a mechanism for creditors to initiate

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**Application:** In this case, State Bank of India demonstrated that M/s. Nasco Trading India

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## Parties

- **Judges:** Ashok Kumar…; Anil Ku…
- **Appellants:** State Bank of…
- **Respondents:** M/s. Nasco…; Rahe…

## Timeline

- **2011-09-02 — Grant of Credit…**: The erstwhile State Bank of Travancore (SBT) granted credit facilities of…
- **2016-02-18 — Enhancement of Credit…**: Cash credit facility was enhanced to Rs.9.5…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 95 — Application by creditor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-95)

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